The email exchange below was between myself and one of our review students, days before (and after) the March 2010 exam. I found this interesting because it happens time and time again where review providers, specifically the Zahn CFP review, will tell students that they know what’s going to be on the exam. Time and time again, they are wrong and are doing a real disservice to their students. It causes students to have a false sense of confidence, study information that’s not tested and overlook information that is tested.
Here’s the email exchange:
Student 3/15/10: Joe - Speaking to a few friends who took Zahn’s review, they indicated that there might be some questions about AMT and some sort of info on carrying credits back three years.
Joe 3/15/10: Yes, there’s likely to be some questions on AMT. However, nobody knows exactly what will be tested and the Zahn review is notorious for playing the guessing game and telling students that this will or will not be tested. In fact, they don’t know... Nobody does. I hear it time and time again, the Zahn review told us this wouldn’t be tested and it was tested or this would be tested and it wasn’t. Stick with what we have covered. If you know our material, you’ll be fine and you’ll pass the exam. At this point, don’t talk to other people, it only causes anxiety and they don’t know what they’re talking about.
Traditionally, the CFP exam has consistently tested a couple of things with regard to AMT:
1. What are the preference items
2. What are the adjustments
3. The AMT consequence for ISO
Instructor’s Input - I covered all three in my weekend of the review and would suggest he review the online lecture. The first two are discussed in tax where this is addressed on AMT. I covered the ISO issue in retirement. I also did quite a few examples on ISO/NQSO in the Jan 15 office hours and discussed the amt issue there as well. As for private activity bonds – we also covered that in the review. Tax-exempt interest on private activity bonds issued in 2009 and 2010 is not subject to AMT. As far as they carryback – without more info I can’t really address that. I have not heard of the board testing any other types of AMT issues. Doesn’t mean it doesn’t happen—just means I haven’t heard about it. Like I said it is hard to tell without more info. If they are talking about the ability to carry back NOLs for AMT – then no, I don’t think that is going to be tested because WHBAA 2009 that was enacted in Nov 2009 made some changes to the way NOL carry backs work. Generally the board avoids things that have had some legislation change that is not yet testable because of the 6 month rule. If they are talking about the ability to have refundable AMT credits that have been unused for 3 years – well I just don’t know. Haven’t heard about that being tested and it seems beyond the scope to me because of all the intricate details that applies.
Student 3/16/10: Great feedback, thanks for taking the time to give a detailed response.
Joe 3/23/10: How were the AMT questions?
Student 3/23/10: Just like you predicted. I recall that there were 3 references to it.
Conclusion - I feel bad for the students that spent time worrying and studying about AMT credits being carried back. It’s unfortunate that they were misled and given wrong information. Remember – Nobody knows exactly what’s going to be tested on the CFP exam. Don’t believe anyone that tells you differently!
Joseph M. Gillice, CPA, CFP®
President
Dalton Education, LLC